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December 11, 2013

Senators Say Retirement Planning Is a Growing Priority

Both say at IRI event that tax reform is important, but Cardin says budget deal is not a ‘grand bargain’

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Sen. Ben Cardin, D-Md., told retirement officials Wednesday that he and his colleague across the aisle, Sen. Rob Portman, R-Ohio, are prioritizing “looking at the next chapter” of pension changes, encouraging more lifetime income options, strengthening auto-enrollment, and focusing on investment advice — specifically watching how the Department of Labor and the Securities and Exchange Commission are “moving forward” with their fiduciary advice rules.

Cardin told ThinkAdvisor after his comments that he wants to make sure that the DOL and SEC “are operating consistently” on their fiduciary rulemakings.

Cardin and Portman, who spoke at an event on Capitol Hill held by the Insured Retirement Institute where they were both honored with IRI’s Champion of Retirement Security Award, agreed on the need for tax reform. However, Cardin noted that while a budget deal was reached Tuesday evening, there won’t be a “grand bargain.”

On Tuesday morning, the budget deal reached by Rep. Paul Ryan, R-Wis., and Sen. Patty Murray, D-Wash., appeared to be headed for Senate passage after sailing through the House.

Cardin said that while the nation desperately needed tax reform, “it will be challenging to get tax reform [legislation] without a major budget agreement.” He encouraged the attendees to “get involved” in the budget and tax debate “as it will only be intensified as we move forward toward the midterm elections.”

Portman agreed, saying, “As we move forward we will have to have tax reform, and move every rock for revenue.”

The senators are known for the Comprehensive Retirement Security and Pension Reform Act, commonly referred to as Portman-Cardin, which was enacted as part of the Economic Growth and Tax Relief Reconciliation Act of 2001.

Both senators recalled how difficult it was for them back then to advance their retirement income legislation due to the lack of support from leaders of either party. “We were told we shouldn’t worry about [Americans’ lack of retirement readiness] because people were saving via equity in their homes,” Cardin recalled.

Added Portman: “Ben stood up to a lot of pressure” on the retirement income issue. “I had to put up with Republicans saying it wasn’t a priority, but he took more heat” from the Democrats.

But despite the tough grassroots effort, “We got major legislation incorporated into tax reform bills--and it was the first major provisions that were made permanent,” Cardin said.

“We are going to [make the same effort] in this Congress” to advance more retirement income changes, Cardin said, “because it’s even more challenging for Democrats and Republicans to work together.”